Owner of Waimea Valley and Sea Life Park files for bankruptcy
By Andrew Gomes
Advertiser Staff Writer
The owner of Waimea Valley Adventure Park and Sea Life Park filed for Chapter 11 bankruptcy yesterday in an effort to block the foreclosure and sale of the key Hawai'i attractions.
Advertiser library photo July 26, 2000
A guide leads visitors on a dive in Sea Life Park's reef tank. The park's owner has filed for bankruptcy but the park, along with sister park Waimea Valley Adventure Park, will remain open.
Advertiser library photo July 26, 2000
But the filing could hamper plans by the city to purchase Waimea Valley, as well as an effort by Attractions Hawai'i to find a private buyer for the North Shore property, because any sale now would have to proceed through bankruptcy court.
New York investor Christian Wolffer, majority owner of Attractions Hawai'i and an affiliated financing company, acquired the parks in 1996 out of the final stages of a foreclosure against a previous owner. Wolffer paid Bank of Hawaii $6 million and was to buy out the remaining mortgages on the parks last June.
But the two sides could not agree on how much was owed, based on different interpretations of a provision in the purchase agreement. The bank says the amount is $4.3 million. Wolffer, who believes he owes $498,000, filed a lawsuit against the bank to settle the disagreement. A judge agreed to let a jury decide, but the bank moved ahead with foreclosure in February.
The bankruptcy filing effectively puts the foreclosure action on hold. No trial date has been set in the case to determine the amount of the outstanding mortgages.
In a statement last night, Attractions Hawai'i said the bank's move to foreclose was an "end-run" around the court's decision. Bank officials said yesterday that they do not comment on matters in litigation.
A commissioner in the bank's foreclosure case recently impounded $329,000 from Attractions Hawai'i, distributing $230,000 to the bank. Wolffer attorney Dan Nadborny said that move "crimps our ability to operate the parks effectively."
"We're doing it (filing bankruptcy) so we can continue to operate the parks," Nadborny said. "That will allow Attractions to continue to run the parks with the funds it needs."
Nadborny said that the parks are doing fin, and that the bankruptcy will result in a successful reorganization. "There will not be a liquidation in this bankruptcy proceeding," he said. "The parks have value in them."
Nadborny did not disclose the amount of assets and liabilities listed in Attractions Hawai'i's filing, which was made in New York. He would not say which was greater, adding that the values of the parks need to be assessed.
Wolffer has said he would like to keep Sea Life Park, but he put Waimea Falls up for sale last August, asking $25 million for the 1,875-acre property, which includes an arboretum and rare plants. The park hasn't made money in years, and has seen attendance fall from 600,000 15 years ago to around 250,000 last year.
After hearing the park was for sale, the city initiated a plan to purchase it, through condemnation if needed, and find a private organization to maintain and operate it while preserving its environment.
This year, the mayor set aside $5.2 million in the city's supplemental budget to acquire the property. An advisory committee has proposed a master plan that would exclude thrill or adventure activities at the park and improve educational and cultural programs.
Last night, committee organizer and Councilwoman Rene Mansho, who represents the North Shore, said the bankruptcy filing will not sway the city from its efforts to acquire Waimea Valley.
"This puts a new wrinkle in the plans, but I don't think this deters us from the preservation of the arboretum and botanical garden," she said. "Our commitment is solid."
Andrew Gomes can be reached by phone at 525-8065, or by e-mail at email@example.com.